Federal Trade Commission (FTC) : Meaning, Functions, and Examples

The Federal Trade Commission (FTC) is an independent, bipartisan body of the United States government entrusted with safeguarding consumers and maintaining a robust competitive market. Lina Khan is the current Chairperson of the Federal Trade Commission (FTC). Its primary goal is to enforce non-criminal antitrust laws in the United States by preventing and removing anti-competitive economic activities, especially coercive monopolies. The FTC also works to safeguard consumers from exploitative or deceptive business practices.

Key Takeaways

• The Federal Trade Commission (FTC) is a bipartisan federal body dedicated to enforcing antitrust laws and protecting consumers.
• President Woodrow Wilson signed it into law in 1914 as part of his administration’s anti-trust campaign.
• The FTC’s responsibilities include investigating fraud or deceptive advertising, conducting congressional inquiries, and notifying parties before a merger.
• The FTC also investigates fraud and unfair or exploitative commercial practices.
• The FTC opposes anticompetitive activity through the Bureau of Competition, which evaluates proposed mergers with the Department of Justice.

1. Investigation: The Federal Trade Commission may examine a single firm or an entire sector. If an FTC investigation exposes illegal activity on the part of one or more corporations in an industry, the agency can seek voluntary compliance through a consent order, commence federal litigation, or file an administrative complaint. Traditionally, such a complaint would be handled by an administrative law judge (ALJ) before being appealed to the United States Court of Appeals and, ultimately, the Supreme Court.

2. Handles Complaints: The FTC also handles complaints against unfair commercial practices, such as fraud and deceptive advertising. Its Bureau of Consumer Protection investigates suspected abuses, takes enforcement action, and offers instructional materials to customers. The National Do Not Call Registry in the United States is overseen by the Bureau of Consumer Protection.

3. Monitors Sales Rule: The FTC also oversees and enforces the Telemarketing Sales Rule, Pay-Per-Call Rule, and Equal Credit Opportunity Act. The Commission is responsible for enforcing or administering over 70 different laws.

4. Research and Examination: The Bureau of Economics supports the FTC’s other two divisions with research, including an examination of the probable impacts of FTC actions.

5. Usual Operation: The FTC’s normal operations include investigating consumer, corporate fraud, and media fraud or deceptive advertising, as well as conducting congressional inquiries and submitting pre-merger notifications.

1. Action on Amazon for Failure to Pay Gratuities

• More recently, in 2021, the FTC ordered e-commerce behemoth Amazon to pay more than $61 million in a settlement for failing to pay all Amazon Flex drivers’ gratuities from Amazon customers.
• The allegations against Amazon allege that the corporation guaranteed its Flex drivers 100% of consumer gratuities while delivering and that customers were informed of this.
• For more than two years, it withheld a portion of customer-paid gratuities from its Flex drivers.

2. Action Against Funeral Homes

• In 1984, the FTC tightened down on misleading pricing in the funeral home business, introducing the FTC Funeral Rule.
• This rule compels funeral houses to publish a printed General Price List (GPL) describing all prices for goods and services in the funeral industry to anybody who wants one.

The Federal Trade Commissions Act of 1914 established the Federal Trade Commission (FTC) and gave the United States government complete authority to investigate unethical commercial practices. The main purpose of the FTC Act of 1914 is to prohibit unfair methods of competition and unfair or deceptive acts or practices that affect commerce. This gives the FTC broad authority to police a wide range of business activities.

In conclusion, the Federal Trade Commission (FTC) stands as a vigilant guardian for consumers and a bulwark against unfair market practices. This article has explored the historical underpinnings of the FTC, its fundamental roles, and its enduring significance in the American economic landscape. As a staunch advocate for fair competition and consumer welfare, the FTC plays a pivotal role in shaping policies and regulations that foster a level playing field in commerce. Through strategic partnerships with governmental bodies, the FTC actively contributes to the formulation of legislation that promotes the interests of consumers while nurturing a robust and equitable market ecosystem.

What does the FTC regulate?

The FTC can regulate commerce by identifying misleading and unfair marketplace behaviors. It also enforces antitrust and consumer protection legislation.

How do I file a complaint with the Federal Trade Commission?

Consumers can register complaints with the Federal Trade Commission either online or by calling 1-877-FTC-HELP.

The FTC also operates the Identity Theft Hotline (1-877-ID-THEFT) and the National Do Not Call Registry (1-888-382-1222).

What happens when you file a complaint with the FTC

When a complaint is filed, the FTC shares it with over 3,000 law enforcement officials. The FTC compiles information from filed complaints into reports that are used to investigate fraud, unfair business practices, and scams.

What is the FTC Act?

The Federal Trade Commission Act of 1914 established the FTC and gave it the authority to prohibit unfair competition and deceptive practices. This is the legal foundation for the FTC’s work.

How long does the FTC take to respond to a complaint?

The objective of the FTC is to answer within the timeframe specified in the Freedom of Information Act, which is twenty working days, or around one month, although this may vary depending on the type of request.

Reference:

• Federal Trade Commission| U.S. Government

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